Is Demat A/C necessary for investing in MFs through SIPs?

POSTED BY Zaib ON February 3, 2011 11:36 am COMMENTS (14)

Hello guys,

I have recently invested in 4 MFs through Bajaj Capital Ltd. with an initial sum of 5000/- each and have applied for the ECS auto-debit facility from my bank a/c.

Now what I came to know afterwards from the financial advisor was that the SIPs will continue debiting in the terms of 5000/- p.m. and I can’t change them with the only option being is to stop the ECS auto-debit facility.

He told me that to stop the ECS auto-debit and to have a manual control on SIPs I need a Demat A/C.

Is that true? Or is there any other way to stop the ECS auto-debit facility without opening a Demat A/C? If the option being a Demat A/C only, then please suggest a good Demat A/C.

He told that BajajCapital Demat A/C has a one-time fee of 1499/- and no future charges. Whats with all this?

 

Please if anybody answers these queries of mine, I’ll be highly grateful!

 

Thanks,

Zaib.

14 replies on this article “Is Demat A/C necessary for investing in MFs through SIPs?”

  1. sir I want to invest in sip mf scheme.which is the best company for investment and other related information plz.
    thanks

    1. You can look at some of the 5 star rated funds like BIrla 95 . Let us know if you want help of my team to setup SIP for you

  2. (Thanks Manish)

    Hello Jignesh,

    Timewise, opening an NRI account is not too different from a resident account. We need a couple more documents from NRI than from a resident.

    Please don’t apply for another PAN card. Just your current PAN card will suffice.

    Once you open an account with us, you don’t need to register separately with any MF company.

    As far as physical communication goes, from your list,

    Buying/selling – after account opening, buying and selling will be fully online, no physical paperwork required

    Changing details – in many cases, physical paperwork will be required (signed letter for email change, KYC update for address change) Scanned copies will not do.

    Cancellation of association – signed letter will be required for the records.

    To open an NRI account, here are the docs you will need

    For FundsIndia account:

    Application form – signed
    Terms and conditions document – signed
    Copy of pan card – self-attested
    Copy of passport – self-attested
    Copy of PIO/OCI card (if foreign citizen) – self-attested
    Cancelled cheque leaf of NRE/NRO account

    For KYC registration

    KYC application – signed (in two places – once on the bottom and once across the photograph)
    Copy of pan card – self-attested and notarized
    Copy of passport – self-attested and notarized
    Copy of PIO/OCI card (if foreign citizen) – self-attested and notarized
    Copy of Address proof (driving license, utility bill, bank statement etc) – self-attested and notarized

    Admittedly, the list looks long, but these are typically simple documents and this is a one-time process.

    thanks,

    Srikanth

  3. Here is a comment from Jignesh , putting it here

    Hello Mr Srikanth,
    Earlier also i tried to contact you in any one of the blog regarding services.
    How much time it will take to open an account for Nri?
    If i have already one PAN card ( taken when my status was not NRI ) , DO i need to apply for another Pan Card?

    Do we need to register with all companies if once associated with Fundsindia.com?

    For Buying/ Selling/Changing Details or Cancellation of association, Physical presence or Signed Papers required or that can be managed over mail/ scanned copies of signatory?

    With Positive Response from your side i am willing to open an A/c for my wife name. what all documents will be required?

    REgards

    Jig

  4. Hello Bharat,

    At any time, if you’d like to close your account, you would need to send us a request to do so. We’ll move your mutual fund holdings to ‘Offline direct’ mode, and deactivate your account.

    thanks,

    Srikanth

  5. bharat shah says:

    @shrikanth meenakshi

    thank you for the information. how difficult /easy to disassociate from fundsindia.com after getting associated it as investor. kindly enlight it.

  6. Hello Bharat,

    Thanks for the information.

    We’ve been trying hard to get SBI on board our platform.

    Now, we’ll try harder.

    Srikanth

  7. bharat shah says:

    @shrikanth meenakshi

    i like to know whether there is any chance that ‘state bank of india’ would be added to your 20 bank list in near future? mutualfundsupermart.co.in seems added sbi recently.

  8. Ahmad Zaib says:

    As I said it is not yet processed. The status is ‘Yet to receive documents’.

    I submitted my application to the agent on 27th Jan. I don’t know why its taking so much time!

    1. Ajay says:

      Ahmad –
      It took about 4 weeks for my status to get updated to “Verified”
      You would have received an acknowledgement letter from Bajaj Capital that your documents are submitted for KYC and if there any info required then CVL will contact you within the next 10 business days. This ack letter is good to be used anywhere after 10 business days in case CVL does not contact you.

      Hope this answers your query on the KYC part.

      Ajay

      PS: I have been using FundsIndia for about 2-3 months now and they have a very good turnaround time for any activities.

      1. Ahmad Zaib says:

        Thanks Ajay for the info.

        No I haven’t received the acknowledgement letter from Bajaj Capital. I’ll enquire about it today only.

        I hope FundsIndia does what I expect it to do. Looking forward to their services 🙂

  9. Hello Ahmad,

    Thanks. If you’re KYC is already processed, then great! We’ll be able to activate your accounts as soon as we get your application forms.

    Srikanth

  10. Ahmad Zaib says:

    Thanks Sreekanth (and Manish for the personal email)!

    I have registered myself on FundsIndia.com and will be sending the documents.

    I have mentioned myself as KYC compliant as the KYC has already been done by Bajaj Capital Ltd. although it is showing up as “Documents Yet to Receive” on CDSL website.

    I hope it’ll get completed in a few days. If that’s not OK, please advise Sreekanth.

  11. Hello Zaib,

    You do not need a demat account to invest in mutual fund SIP.

    If you want to stop an SIP mid-stream, you should be able to send a request to the mutual fund company to stop the SIP. You would need to do it for the four MFs separately though.

    A better way to manage the SIP process with more flexibility is to go through online channels such as ours (FundsIndia.com) that offer more flexibility – you can do multiple MF schemes in one debit, pause or stop the SIP mid-stream, do Flexi-SIP etc.

    Please visit this page for more details:

    http://www.fundsindia.com/content/jsp/corporate/Sipcompare.do

    thanks,

    Srikanth
    FundsIndia.com

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